In the News

July 06, 2013

The ex-president of BitTorrent, the peer-to-peer file-sharing service many associate with piracy, has jumped to the same team as television broadcasters with Flingo, a Shazam for video. And engineers from BitTorrent have joined him.

Flingo's algorithms recognize what's happening on live television and, if viewers opt in with their remotes, can pull up information about what's up and offer ways to interact.

(Credit: Flingo)

For years, Ashwin Navin ran BitTorrent, the peer-to-peer technology company that many people associate with pirated entertainment. Now he's flipped to the other side. He and a contingent of BitTorrent engineers are playing on the same team as television broadcasters at his current venture, Flingo.

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Flingo is to video what Shazam is to music. They're both so-called "automatic content recognition," or ACR, software programs. Where Shazam can recognize a song simply by listening to it, Flingo can recognize actors who walk on screen during a TV broadcast -- and it can offer information and ways to interact related to them.

Flingo raised $8.5 million in its first round of venture capital backing, attracting the likes of billionaire Mark Cuban and August Capital, whose David Marquardt was the sole investor in Microsoft.

Navin, the co-founder and chief executive of Flingo, talked with CNET about what's changing (and what's not) in television, and how Flingo is approaching it differently than others in Silicon Valley. The following is an edited Q&A.

Q: Talk a little about your history and how that brought about Flingo.Navin: I ran BitTorrent for four years, and most of Flingo's co-founders are engineers from BitTorrent. BitTorrent continues, and is doing better than ever, but we were intrigued by television. We were interested in figuring out how to use digital rights to make a TV service, but when cable operators saw smart TVs and consoles bring connectivity into the living room, the cost of digital content went sky high. We pivoted and got away from that quickly.

Some in Silicon Valley thought cable would die a quick death, but the buying power they have will keep them in business for another decade or two. We've pivoted to the opposite opinion, and now we're thinking of how to use the Internet to deliver the content but in a different way.

What is Flingo's technology?Navin: Our tech sits within the televisions and in the phones and tablets themselves. Our software is ACR -- think of Shazam -- when you're trying to think of the name of the song, it will grab audio from the room. That, in industry jargon, is ACR: automatic content recognition. We fall into that group, as a company that makes ACR technologies. Basically, Flingo does the same thing but for video not audio.

What can Flingo do?Navin: The most common thing is having instant access to cast and crew information. If you see an actress walk on a screen and can't remember her name, Flingo can recognize her and bring up information about her. That metadata lives either in a TV overlay that the user initiated or in a phone app or tablet app. It can do other things, too. The most natural extension of reality programming would be the ability to interact with viewers, such as voting with your TV remote for "American Idol" rather than with a phone. Other examples are the likes of a CNN or Fox News having the ability to take polls with TV remote. We've built up a bunch of building blocks for networks to use.

Flingo's Ashwin Navin.

(Credit: Flingo)

How can viewers use Flingo?Navin: With a show, regardless of whether it comes from Netflix or Comcast, you're able to unlock clips or behind-the-scenes content, for example. You can do that in a tablet, but also we came up with a really simple interface for televisions themselves, where you get a Shazam-like icon in the corner of the screen that you can click on. For the creators, it doesn't matter how they choose to bring their content to market, the intelligence is in the device.

It's called Samba -- the underlying tech -- that synchronizes a Web browser, and it will become ubiquitous. Right now, it requires people to buy devices that have this technology in them. Last year, that population was nonexistent. It's small this year, but next year it will get bigger [The company is in talks with manufacturers to have its technology shipped in TVs later this year.] The software we've written over the history of our company is sitting in 30 million devices. We've always been focused on the TV devices or Blu-ray players, now we're turning our attention to phones and tablets.

What has been the response from the hardware makers and television companies?Navin: The thing we get asked a lot from device manufacturers and from broadcasters is, "How does this make money?" The answer is that all the things that make content more engaging also apply to ads. So, for example, if you're watching a Volkswagen ad, maybe it piques your interest, maybe you can find the nearest dealership with the click of a remote. We're having those conversations now. In a world where Hopper is stripping the ads, this is very timely. TV ads will have to transform into something more personalized and multiscreen. And it leverages the fact that people are viewing broadcast content about 5 hours a day, if you believe Nielsen.

How does Flingo itself make money?When we create an experience both on a television and on a second device, those are monetized with ads. We anticipated, and this is starting to get proven out now, those screens will be sponsored by a brand. A whole new category of programming is emerging that's synchronized with television. We're acting as execution of the commitments made by ad sales teams at networks.

If you add up all of Google's revenue, all of Yahoos' revenue, all of Facebook's revenue, it still doesn't even get you to half of the up-fronts every year for TV ad business. We would love to make that system more efficient and more engaging. Every startup's business plan is that if it can take X percent of television ad dollars, then it'll be a success. We said, "Hey, why don't we try to make the TV ad budget bigger rather than smaller?"

Every startup's business plan is that if it can take X percent of televison ad dollars, then it'll be a success. We said, 'Hey, why don't we try to make the TV ad budget bigger rather than smaller?'" --Ashwin Navin, Flingo CEO

Some would look at your last venture and your current one and call it an about-face. Agree or disagree?Navin: I don't know if it's an about-face, but what we do today is something BitTorrent could never do. We spend a lot of time developing the algorithms to know the shows, what they are, who is in them. BitTorrent has to be blind to the content and be only a delivery mechanism, to be in a safe legal position. At Flingo, we consciously try to learn what the content is.

What are some of the challenges in building up Flingo?Navin: We spend a lot of time on 160 channels, ingesting all the video on these networks every day and inscribing metadata on them. It's a hard-core, heavy-duty engineering effort. We have four data centers across the country -- one in every time zone, and we'll continue to expand that. We'll be focused on the U.S. for the foreseeable future. Next on the roadmap is some European extension, probably next year.

When Google came to market, it basically had a massive investment in crawling the Web to index Web pages and pull out meta data to describe them. They had a really sophisticated algorithm to attach value to that meta data. We're trying to do a similar thing for TV content. That's a massive engineering effort. We've been a bootstrap company for most of our history, and when we wanted to deploy on that scale, that led us down the path of venture capital.

What makes Flingo different from other digital television ventures?Navin: Most Silicon Valley companies, when they think about content, they want to be virtual cable operators. That is not a trivial undertaking and very few have succeeded in that. When they do, they have had some sort of unfair advantage. In the case of BitTorrent, it didn't have to pay for content. In the case of YouTube, users provided it. In the case of Hulu, it had the broadcasters attached. We're more interested in being like a GPS operator than the telco operator.

What is Flingo's focus at the moment?Navin: First and foremost, it's working with app developers and manufacturers that use our tech -- that's the first milestone. Second, it's around usage, what people are doing with Flingo and how they're playing with the apps. We're focused on the first set of metrics now, and then, I'd say, it'll be the end of this year when we'll be attentive to the end user.

What about the future of television? How do you see it?Navin: TV has to think about how to leverage people's existing behavior. We don't think that TV is ripe for revolution. We think it's ripe for transformation. The consumer, through a recession, has continued to pay for cable and satellite. Very few, even when budgets were tight, cut the cord. What we think is happening, and is quite interesting, is that the TV Everywhere battle was won by the cable companies and now the area where there is a lot of room for transformation is on the advertising side and on companion devices. Tens of millions are watching TV with another device. That's where we think the TV Everywhere battle will be fought next.

June 24, 2013

The rate at which you reply to e-mails may reveal your overall competence. At least according to Gigwalk, a company that helps businesses hire on-the-spot temporary workers. “If you reply within an hour, your success rate for completing a job ends up being about 97 percent,” says Gigwalk Chief Executive Officer Bob Bahramipour. “But if it takes longer than five hours, that number drops to 47 percent.”

Gigwalk, launched in 2011 by three former Yahoo! (YHOO) colleagues, has developed several mathematical models that shed light on employee behavior and follow-through. To hone its metrics, the company evaluated more than 300,000 workers who have used the GPS-based Gigwalks app to take nearby jobs doing everything from testing iPhone software to snapping photos of restaurants and nail salons for online-mapping companies.

Gigwalk uses what it calls its “Moneyball engine”—a reference to the book and film about a baseball team built by scrutinizing data to find undervalued talent—to find good workers without ever engaging in personal interactions. “We never meet our workers, never interview them, never look them in the eye,” says Bahramipour. After all, interactions cost time and money, and they don’t necessarily reveal much. “Selection at temp agencies is a somewhat random process,” he says. Gigwalk, by contrast, makes the claim: “We know more about our workers than anyone has ever known about workers.”

Asked what becomes of Gigwalk’s low-rated workers, Bahramipour suggests that his system is actually more forgiving than a human boss—a claim he stakes with reference, again and again, to the book about the Oakland A’s. “Our Moneyball machine manager is dispassionate—it deploys workers rationally based on their skills and observed behavior,” he wrote in an e-mail, explaining that slow but accurate “Gigwalkers” might be given jobs with distant deadlines, while those who are fast but inaccurate might land simple jobs with tight deadlines.

“In this way, Moneyball actually helps workers be more successful,” says Bahramipour in a telephone interview. “Where a human manager might pass up workers because of an apparent flaw, the Moneyball machine manager will pick up that worker and use him or her the best way possible. Just like the Moneyballconcept in baseball.”

Job candidates start out doing simple gigs in which the cost of failure is low. “If we hire someone to take a photograph of a stop sign at a specific intersection and they don’t show up, that sign will be there the next day,” says Bahramipour. Once Gigwalk evaluates qualities such as promptness, thoroughness, and efficiency, it matches workers with appropriate jobs.

The company measures each worker’s productivity by tracking his or her GPS location and the amount of time spent on the job. So if two workers do a similar gig—setting up a store display, for example—but one takes half the time, Gigwalk can easily tell who was more efficient. The company also evaluates how much complexity each worker can handle before running into trouble. The idea, says Bahramipour, is to measure “how well a worker truly can follow instructions—something you could never get from an intuitive interview.”

So far, Gigwalk is active in the U.S., Canada, and the U.K. The app is currently available only on the iPhone (AAPL), but Gigwalk plans to introduce an Android version soon. The service is similar to that offered by TaskRabbit, except that Gigwalk connects companies to workers, rather than connecting individuals. Members of Gigwalk’s “smartphone army” have completed more than four million jobs for 5,800 businesses, including Microsoft (MSFT), BMW (BMW), andEBay (EBAY).

Workers usually get $12 to $15 per hour and are paId via PayPal, says Bahramipour. Gigwalk normally keeps a cut of about 30 percent to 40 percent per job. The private company, which is not yet profitable, also sells analytics that help clients keep better track of work done by temporary hires.

Mr. Goldstein also has secured $2.5 million in equity and $25 million in debt financing from Chicago-based alternative investment firm Victory Park Capital. AvantCredit, which hopes to generate $50 million of loans this year, so far has lent $3 million. It employs 23 and could have as many as 100 employees in Chicago by year-end, he says.

In the next five years, the firm hopes to build a loan portfolio between $1 billion and $2 billion.

Mr. Goldstein and his team of 20-something execs at AvantCredit, recruited mainly from Chicago-based Enova, see untold demand for credit among middle-class households with credit ratings just below prime. That population, aggressively served in the past by credit card companies and brick-and-mortar lenders like Prospect Heights-based Household Finance Corp., today is lacking as many loan sources.

“In the subprime space, there's been a lot of innovation,” Mr. Goldstein says. “There really hasn't been in the near-prime space.”

Analysts who follow companies offering unsecured installment loans to consumers say Mr. Goldstein is right to think that demand for those loans is outstripping supply. “At the end of the day, the credit card companies aren't serving customers in that segment,” says John Hecht, an analyst at investment banking firm Stephens Inc. in San Francisco. “The large installment loans—there's been tremendous demand for them.”

YOUNG ENTREPRENEUR

Mr. Goldstein's track record was key to securing $10 million from Menlo Park, Calif.-based August Capital to launch AvantCredit. Born in Uzbekistan, Mr. Goldstein started his first business, an online payday loan outfit then called CashNetUSA, at age 23. He invested part of the $70 million he cleared after selling it into creating Pangea Properties, a real estate investment trust that's grown to more than 8,000 apartments in low-income neighborhoods of Chicago, Indianapolis and Baltimore.

Co-founder John Sun, whom Mr. Goldstein lured from Enova to run AvantCredit day to day along with co-founder Paul Zhang, says the company is targeting middle-income households with credit scores between 620 and 720—just below prime. Circumstances that cause consumers to register below-prime credit scores include not paying bills or making late payments, selling a home at a price below its mortgage or having a limited credit history.

Interest rates range from 35 percent to 95 percent a year depending on where borrowers fall on that credit spectrum. Loans are payable over one to three years.

Still, AvantCredit is no sure thing. There are significant risks in making large loans over the Web. One is the need to give consumers a quick and easy way to apply for loans while determining whether they will repay them. Another is getting repaid. Unlike payday lenders that automatically withdraw payments from customers' bank accounts, borrowers using AvantCredit make monthly payments, online or via the U.S. mail if they wish, just as they would with a bank.

AvantCredit is putting its faith in its ability to quickly access all kinds of public information about an applicant and crunch numbers to get a reliable gauge on how likely a person will be to pay back the money.

“Fraud is a huge risk,” Mr. Goldstein acknowledges. “You're not seeing a customer face to face.”

A potentially bigger risk is one that ultimately forced Household in 2003 to sell for cheap to London-based banking giant HSBC Holdings PLC: loss of financing. (Six years later, HSBC exited Household's branch-based lending business after suffering punishing losses.) Once non-bank lenders like AvantCredit are established, they depend on loans from big banks or the public debt markets to finance their loans. Loss of confidence in a lender, for whatever reason, quickly can jeopardize future funding.

“It's going to depend on performance,” says W. Eric Carlborg, general partner at August Capital. “If the business continues to grow, we're going to continue to be substantial investors.”

(Editor's note: The story has been updated with financial details of the new company.)

April 25, 2013

Mavenir wins two IMS Industry Awards for Voice over LTE and RCS 5 Solutions and Launches

Mavenir's Convergence TAS is Best VoLTE Product

BARCELONA, Spain, April 25, 2013 /PRNewswire via COMTEX/ -- Mavenir Systems, a leading provider of software-based networking solutions, today announced that it had won two awards for its Voice over LTE (VoLTE) and Rich Communication Services (RCS) Solutions. The company picked-up the awards for "Most Innovative Service Launch by IMS" and 'Best VoLTE Product' in the prestigious Informa Industry Awards held at the 2013 IMS World Forum in Barcelona.

The world's first launches of VoLTE and RCS 5 services with Mavenir's suite of RCS 5 application servers were recognized as 'Most Innovative Service Launch enabled by IMS'. Both launches were with MetroPCS including the VoLTE launch in August 2012 and the RCS 5 launch, only 90 days later, in October 2012.

Mavenir's 'Best VoLTE Product' award for the Convergence Telephony Application Server (TAS) that enables the transformation of mobile networks to all-IP LTE. As part of a highly integrated E2E solution, Mavenir's TAS is uniquely equipped to offer service parity and synchronization with the circuit switched network so operators can quickly and easily integrate new services while saving costs. It can be deployed in a standalone configuration with any 3rd party IMS core or bundled with Mavenir's IMS solutions to offer a cost-effective end-to-end IMS voice service.

"As a next generation player, we are very pleased to win not one, but two awards, especially against the traditional vendors," said Ian Maclean, Mavenir's Vice President of Strategy and Marketing, who received the awards. "Mobile operators worldwide have selected Mavenir for our innovation and leadership in the market so it was an honor to be recognized in front of many of them."

Mavenir's suite of application servers and recently announced Virtualized IMS solutions, including the Telephony Application Server, Presence Server, Content Server and Rich Messaging Server, are based on the mOne� Convergence Platform and are specifically designed to simplify mobile operators' network transformations.

About Mavenir:

Mavenir is a leading provider of software-based communications solutions that enable mobile service providers to deliver high-quality internet protocol (IP)-based voice, video, rich communication and enhanced messaging services to their subscribers globally. Mavenir's mOne� software platform has enabled leading mobile service providers to introduce the industry's first live network deployment of Voice-Over-LTE (VoLTE) and the industry's first live deployment of next-generation Rich Communication Services 5.0 (RCS). Our solutions deliver next-generation services such as RCS, VoLTE and Voice over Wi-Fi (VoWi-Fi) over existing 2G and 3G networks and next-generation 4G LTE networks. www.mavenir.com

This willingness to share -- even something as valuable as a sports car -- is the premise behind carsharing, a growing industry that connects car owners with renters seeking out a temporary set of wheels. What started with Zipcar's community car fleets in 2000 has expanded to include individual owners making their cars available to strangers over the internet. Carsharing, as a result, is threatening the long-entrenched structure of auto ownership.

The so-called sharing economy -- people rent out spare bedrooms (AirBnB), under-utilized conference rooms (LiquidSpace), and even their free labor (TaskRabbit) -- has grown substantially in just a few years. But the transportation industry has seen the greatest change. A 2012 study by Lacey Plache, chief economist at Edmunds.com, found that young adults aged 18-34 purchased 30% fewer cars in 2011 than they did in 2007. Now, carsharing may be a leading indicator for a much broader set of services.

Carsharing proponents argue that, for those who own vehicles, renting them out to strangers through services like RelayRides or FlightCar can defray car payments considerably (sometimes altogether). For renters, paying for a car only when it is actually needed can be much less expensive ownership, particularly in big cities. Carsharing -- along with a revamped take on carpooling, dubbed ridesharing -- has gotten a jolt from smartphone-wielding millennials in need of a ride. "For a long time the [car] was the symbol of freedom, the symbol of adulthood," says Haddad of RelayRides. "That's apparently been shaken up in a lot of younger people's minds."

How's it work? San Francisco-based FlightCar allows car owners to rent out their wheels while traveling. Users park at the airport, for instance, and let another traveler use their cars until they return. Ridesharing services like SideCar and Lyft, both headquartered in San Francisco, connect ride-seekers with local drivers who use their own cars to taxi people around; they require only an app to operate. Thanks to smartphone technology, even traditional taxi and limo services are working to get in on the action. Flywheel and Uber help passengers hail taxis or limo-type rides using GPS to find the closest possible driver.

Such services have been largely fueled by a growing number of American urbanites. In 2010, more than 80% of the U.S. population lived in urban areas compared to only 73% in 1980, according to census data. Cities provide car owners with financial challenges like higher gas prices, insurance, and difficult to find or expensive parking. These higher ownership costs have kept teenagers from rushing to the DMV. Roughly half of all 16-year-olds had their driver's license in 1978. By 2008, that figure fell to 31%; in 2010, it was down to 28%. For people who need cars only sparingly, renting from a neighbor is sufficient. For those without a license, bumming a ride has become easier. "We are moving from a product-oriented economy to a services-oriented economy," says Sunil Paul, CEO of SideCar. "We are going to turn transportation from a product (buy a car), to a service (download this app)."

Carsharing and ridesharing platforms have stepped in to fill the void. SideCar drivers had completed 10,000 rides in July of 2012; by December that figure rose to 100,000. RelayRides has cars for rent in more than 1,200 cities across the country, all of them added since last year. Flywheel's taxi hailing software is in 3,000 taxis across the country, and will soon expand into New York City when vendors begin using "e-hail" technology, possibly at the end of March. Zipcar has more than 760,000 members and was acquired by Avis for $500 million in January.

Of course, this stream of carsharing and ridesharing services that cropped up during the recession is also competing with a rejuvenated auto industry -- U.S. car sales were up 13% in 2012 over 2011. All three major U.S. automakers showed improved sales led by Chrysler's 21% jump last year. And sharing economy proponents aren't the only ones who have been trying to make car ownership cheaper the last few years -- during the recession, car dealerships worked hard to stifle ownership fears by offering customers lower interest rates on car loans than the banks.

Ridesharing is also testing the bounds set up by state law. Last fall, the California Public Utilities Commission (CPUC) levied $20,000 fines against Uber, SideCar, and Zimride, which operates the Lyft app. The CPUC issued a cease and desist to both SideCar and Lyft around the same time; Uber received its cease and desist letter in 2010. In October, Uber pulled out of New York City, citing "roadblocks" from the city's Taxi and Limousine Commission (TLC). (The city approved "e-hail" apps in December, but the TLC is now being sued by Livery car groups in an attempt to stop the e-hail program, which could start this month.) In California, the CPUC fines for Lyft and Uber were suspended in January as the state began an "interim rulemaking period" to determine how best to approach this new avenue of transportation. The agreement specified that ridesharing was also temporarily legal. In a blog post, Uber, which currently only matches up passengers with commercially licensed taxi or town car drivers, announced intentions to join Lyft and SideCar in the ridesharing business.

According to Paul, taxi operators provide the majority of complaints to the state regarding competitor ridesharing services, and other established transportation players will soon take notice of these carsharing and ridesharing platforms if they haven't already. Avis (CAR) showed signs of adaptation when it purchased Zipcar, a carsharing veteran at just over a decade old, at the beginning of the year. RelayRides hasn't made contact with any rental services to date, says Haddad, but has gotten support from one major automaker: General Motors (GM). GM Ventures, the corporation's investment arm, is a financial backer.

Different sharing communities have begun to carve out their respective roles in the modern transportation landscape, and it appears as if there is room for everybody -- for now. "What we need to be focused on as vendors," says Humphreys, "is getting consumers around, getting them to not want to own a car, and getting them all the alternatives they want to get their hired rides."

March 04, 2013

A year ago, San Francisco-based RelayRides launched nationwide with the idea that, just like people are willing to rent their homes to strangers to make some extra money, they’d be willing to do the same with their cars.

Today the company says it’s proven its point, announcing that vehicles in its peer-to-peer car-renting network are now available in all 50 states.

The last states to fall were the Dakotas, says Steve Webb, a company spokesman. Though the Great Plains aren’t the geography most commonly associated with trendy sharing-economy apps,RelayRides likes to make the point that its service makes as much sense in a rural area as in a city.

Rent-by-the-hour car-sharing companies like Zipcar need the more frequent usage that comes with urban density to cover the cost of maintaining a fleet, Webb says. Peer-to-peer car-sharing doesn’t have that issue, since the cars’ owners would be paying for the upkeep of their vehicles anyway.

At the moment, RelayRides says vehicles in its network are available in 1,366 cities and towns across the country (see above). Though it won’t disclose an exact number, the company says thousands of cars are being rented to tens of thousands of drivers.

As with other digitally driven sharing-economy services, such as Uber for taxis or AirBnb for lodging, RelayRides runs on the realization that there’s money to be made in idleness. According to the company, most cars sit unused about 92 percent of the time. And while it sits, your car is doing one thing: depreciating.

RelayRides’ pitch to car owners is that now you can make your car earn its keep. The average monthly cost of car ownership is $233 per month. The average car owner who rents his or her vehicle out through RelayRides, meanwhile, brings in an average of $250 per month. That’s the equivalent of renting your car out just a few hours per week.

RelayRides depends on a fairly stringent screening process to weed out bad drivers from taking your car into a ditch. In addition to having cars in all 50 states, the company is also linked up to all 50 state DMVs. Too many moving violations and you can’t rent using RelayRides.

The cars themselves are screened by the drivers themselves, who leave feedback and star-ratings after they’re done driving much as they would rate a seller after buying something on eBay. And this isn’t surprising: RelayRides CEO Andre Haddad once worked as head of product for eBay’s multi-billion-dollar global marketplace.

That experience in managing one of the world’s largest platforms for peer-to-peer buying and selling makes Haddad a good fit for RelayRides, which he says is all about changing the way people think about their relationships to cars. Instead of a car being something to be owned, a car is something to used.

“The way people use cars hasn’t really changed much in the past century,” Haddad says. RelayRides wants to be that change.

“It’s a business model innovation,” Haddad says. “It’s the same car. We’re not changing car technology. We’re changing the way people use cars.”

February 23, 2013

Is the market for protected personal information about to take off?

EMBARRASSING pictures on Facebook show you dancing the hula naked at a frat party. A convicted bank robber in Texas has the same name as you—as every Google search makes all too clear. Such embarrassments would surely never befall you, dear reader. But they are common enough to spawn an entire business devoted to protecting and polishing people’s image online. Reputation.com, a Silicon Valley technology firm, is hoping that this year the market will finally fulfil its potential.

Reputation has 1.6m customers. For $99 a year or more they get a basic “reputation starter” package, which monitors when they are mentioned online and alerts them if anything sensitive comes up, such as “your real age, name, address, mugshots, legal disputes or marital problems”. For $5,000 a year, the firm will “combat misleading or inaccurate links from your top search results” (most people do not look at results much below the top page or two).

The problem has been to create a profitable business. Although there has long been evidence of growing unease about online privacy, getting anyone to pay for greater control of their image has proved difficult. “A lot of companies have started with idealism about empowering the online user, only to find that the user wouldn’t pay,” says Esther Dyson, a technology investor, who nonetheless remains optimistic that this will change.

Michael Fertik, Reputation’s 34-year-old founder, thinks the change is now happening, helped along by several recent deals. In January Reputation acquired Reputation 24/7, a British competitor. It also began a partnership with Equifax, one of America’s big three consumer-credit monitoring firms, offering Equifax’s customers free access to Reputation’s basic online identity-monitoring and clean-up services. TransUnion Interactive, a competitor of Equifax, will roll out a similar arrangement with Reputation in the spring.

The next step is to launch a data vault—like a bank vault containing all the data that constitute a person’s reputation. It is the most important step in Mr Fertik’s idea not merely to give people more power over their data but to “invert the basic business model of the internet”. The current business model, as he describes it, is that giant firms give customers something free, collect data on them without their knowledge and sell it to third parties to do with whatever they like. “We want to turn it on its head, by [letting] the consumer… decide if they want to sell information about themselves to companies that want to get to know them.”

The upstart firms face some technology problems. Reputation is making progress in some areas, such as how to ensure the person whose online presence is being monitored is actually the person you think he or she is. But the biggest challenge is to find enough buyers and sellers to create a marketplace potentially worth billions. Mr Fertik reckons critical mass will come at around 10m individual customers and around 50 companies keen to pay for access to their data vaults.

Not everyone is convinced consumers will go for this. One boss at Microsoft argues that most people will find managing personal data too complex and that in practice online privacy will be secured by regulation, not products. In the past couple of years more firms have started to accept that personal data will be protected more strongly than before, whether by regulation—which is likely to be tightened in Europe and America—or through market mechanisms like those envisaged by Mr Fertik. Indeed, the data vault may usher in the sort of market-based solutions that “might discourage heavier regulation by Congress, where protecting privacy is one of the few genuinely bipartisan causes,” says Jon Leibowitz, the (outgoing) chairman of America’s Federal Trade Commission. “Reputation.com is very far ahead of the curve in trying to give consumers some control over their data,” he adds.

Reputation is not alone, though. It competes with a host of start-ups, from personal.com to mydex. Another firm, Snapchat, is tackling the problem at its source by allowing people to send photos to friends that erase themselves shortly after being viewed. Some big firms, including banks and maybe even current internet giants, will probably enter the new market. Some may even offer to buy Reputation. Mr Fertik is not fazed. His firm has the advantage of that most valuable thing, which it must protect at all costs: a good reputation.

February 11, 2013

PALO ALTO, Calif., Feb. 11, 2013 – VMware, Inc. (NYSE: VMW), the global leader in virtualization and cloud infrastructure, today announced it has signed a definitive agreement to acquire Virsto® Software, a Sunnyvale, Calif.-based provider of software that optimizes storage performance and utilization in virtual environments.

“VMware is committed to continuing to deliver software innovations that bring significant efficiencies to our customers while simplifying infrastructure and IT,” said John Gilmartin, vice president of storage and availability, VMware. “We believe that the acquisition of Virsto will accelerate our development of storage technologies, allowing our customers to greatly improve the efficiency and performance of storage in virtual infrastructure.”

Organizations are looking for solutions to address the increasing complexity and cost of storage within virtual and cloud environments, particularly for virtual desktop infrastructures (VDI), large software development and test centers and to support business-critical applications. Virsto provides breakthrough storage optimization technologies that improve storage performance and utilization in these environments. When implemented within a VDI, Virsto can reduce the cost of storage per desktop by as much as 70 percent.

As part of its strategy to deliver the software-defined datacenter, VMware continues to invest and innovate to extend the benefits of virtualization to every domain in the datacenter – compute, network, storage and the associated security and availability services. VMware has been at the forefront of innovations to storage in virtual environments, and the acquisition of Virsto will expand VMware’s storage portfolio, which includes the storage virtualization and management capabilities of VMware vSphere® and the VMware vSphere Storage Appliance™. In addition, EMC Corporation plans to license the Virsto technology, extending the cooperative efforts between the two companies in storage architectures.

“VMware and Virsto share a highly aligned vision to remove complexity and increase efficiencies through virtualization,” said Mark Davis, CEO, Virsto. “We are excited to combine forces with VMware to provide customers a more cost-effective, efficient, and agile storage architecture.”

Terms of the acquisition were not disclosed. The acquisition is scheduled to close in the first quarter of 2013 subject to customary closing conditions.

About VirstoVirsto® Software Corporation changes the economics of storage in virtualized environments by improving utilization, increasing performance, and accelerating VM storage provisioning. Virsto reduces the cost and complexity of storage for VDI, test and development, business-critical application virtualization, cloud computing and other virtualization initiatives. Founded in 2007, Virsto is backed by leading Silicon Valley venture firms. For more information, visit www.virsto.com.

About VMwareVMware is the leader in virtualization and cloud infrastructure solutions that enable businesses to thrive in the Cloud Era. Customers rely on VMware to help them transform the way they build, deliver and consume Information Technology resources in a manner that is evolutionary and based on their specific needs. With 2012 revenues of $4.61 billion, VMware has more than 480,000 customers and 55,000 partners. The company is headquartered in Silicon Valley with offices throughout the world and can be found online at www.vmware.com.